"There was no harassment, favoritism or any other abuse of authority" by Strauss-Kahn, the IMF executive board said in October 2008.

But "the incident was regrettable and reflected a serious error of judgment" by Strauss-Kahn, "as he has acknowledged and for which he has apologized," the IMF said in a statement at the time.

He hired a lawyer and sought advice from "friends at a public relations firm," according to the inquiry by Morgan Lewis, a law firm.

Strauss-Kahn also issued a statement following the closing of the investigation, noting that he'd "apologized for it to the (board of directors), to the staff of the IMF and to my family," as well as "the staff member."

"I agree with the board that the personal behavior of the managing director sets an important tone for the institution and I am committed, going forward, to uphold the high standards that are expected of this position," he said in the statement.

The woman left the IMF shortly after "the termination of the affair," but the report found that her departure was not the result of it.

The report did not name the woman.

Strauss-Kahn has led the IMF during the global financial crisis.

The Washington-based agency has helped to bail out the economies of Greece and Ireland under his leadership, part of an effort to prop up Europe's currency, the euro.

He was finance minister when his own country joined the newly-created euro, ditching the French franc.

Strauss-Kahn, 62, is married to the Franco-American journalist Anne Sinclair. They live in Washington.

He was elected to the French National Assembly, the lower house of parliament, three times between 2001 and 2007.

He has also taught economics at Stanford University in California and at the prestigious Institut d'Etudes Politiques de Paris, commonly known as Sciences Po.

Political analysts in Paris said Sunday that Strauss-Kahn's arrest has sent shock waves through France -- threatening to, at once, disrupt and redefine the upcoming presidential race as well as end his political career.

"It's amazing," said Christian Mallard, a political analyst for France's TV3 network. "I would say that if Strauss-Kahn is out of the political process for the presidential elections, definitely we will be starting a political tsunami."